Thursday, December 27, 2007

Taxing Strip Joints To Benefit Rape Victims

They are going to do just that in Texas:

In what some have dubbed the "pole tax," the Lone Star State will require its 150 or so strip clubs to collect a $5-per-customer levy, with most of the proceeds going to help rape victims. The tax goes into effect on New Year's Day.

Club owners and some of their customers say the money is going to a noble cause, but they argue that the tax infringes on their First Amendment right to freedom of expression, that it will drive some bars out of business and that it unfairly links their industry to sex crimes.

My eyes went permanently crossed from trying to think this one through. Thoughts popped in and popped out, so I'm going to number them here, to capture them before they disappear altogether:

First, if the tax is levied as a "sin tax", it shouldn't be expected to yield revenues for the state. Instead, it should be aimed at cutting back on the consumption of lap dances and suchlike services. On the other hand, if the tax is just your ordinary revenue tax, why link its proceeds to the funding of services for rape victims?

My suspicion is that the politicians want to tax the strip joints because the demand is pretty inelastic (meaning that most men who frequent them won't stop going because of an extra five-dollar charge) and thus will give the state lots of revenues. At the same time, the state can pretend that they are frowning on all that grinding and bumping, and that pleases the fundamentalist faction in Texas.

Second, if you read the whole article I link to you will notice various takes on this issue, including the argument that the extra tax will just hurt the strippers who otherwise would all go to college with the income they are earning from rubbing their pubic bones against the mustaches of some men. It is an odd argument, economically speaking, because who ultimately bears the burden of this tax depends on the elasticities in both the market for the strip joints' products and the market for stripper services. It is by no means certain that the strippers will end up bearing the whole burden of the tax.

It is also an odd moral argument in some ways. Are we now to view the strip joints as charities, existing only for the purpose of giving the strippers a chance to get a college education?

Third, the article appears to argue that the tax introduces a class-based injustice into the system: Rich guys can easily pay the extra tax for their titillation, whereas the poor guys in their pickup vans must now stay at home (and do what instead?). Are we really supposed to be concerned with this particular aspect of the class war? That all men should have equal access to lap dances?

Fourth, note that the architect interviewed in the story routinely takes his customers to strip joints. Including female customers? Does he ever have female customers? Does he have female colleagues? How common is this way of doing business, with the other half of humanity acting as a sort of gigantic masturbation mitten? Is that deductible in taxes?

Fifth, and finally (though I could go on for longer), what IS the relationship between the use of strip joints and sexual violence? Is there any good research on this topic? And if there is good evidence on such a correlation, shouldn't the state of Texas use that in a way which actually protects women, rather than make money out of the industry?

The whole story leaves a bad taste in my mouth. Duplicity upon duplicity.
Link by GM.